10-QPeriod: Q1 FY2021

CHARTER COMMUNICATIONS, INC. /MO/ Quarterly Report for Q1 Ended Mar 31, 2021

Filed April 30, 2021For Securities:CHTR

Summary

Charter Communications, Inc. (CHTR) reported robust financial results for the first quarter of 2021, demonstrating significant year-over-year growth in key areas. Total revenues increased by 6.7% to $12.52 billion, driven primarily by strong performance in residential Internet and mobile services. Adjusted EBITDA, a key profitability metric, surged by 12.5% to $4.95 billion, indicating effective cost management and operational efficiency. Net income attributable to Charter shareholders more than doubled, rising from $396 million in Q1 2020 to $807 million in Q1 2021, translating to a substantial increase in diluted earnings per share from $1.86 to $4.11. The company's operating activities generated strong cash flow, with Free Cash Flow increasing by 33% to $1.86 billion, underscoring its ability to generate cash from its core operations. Charter continued its aggressive share repurchase program, demonstrating confidence in its valuation and commitment to returning capital to shareholders.

Financial Highlights

47 data points
Beta

Revenue

$12.52B

Net Income

$807.00M

6.4% Net Margin

EPS (Diluted)

$4.11

Total Assets

$143.44B

Cash & Equivalents

$772.00M

Free Cash Flow

$1.93B

Financial Statements
Beta
Revenue$12.52B
Operating Expenses$10.45B
Operating Income$2.07B
Net Income$807.00M
EPS (Basic)$4.22
EPS (Diluted)$4.11
Shares Outstanding (Basic)191.40M
Shares Outstanding (Diluted)205.87M

Key Highlights

  • 1Revenue increased 6.7% year-over-year to $12.52 billion, driven by Internet and Mobile growth.
  • 2Adjusted EBITDA rose 12.5% to $4.95 billion, reflecting improved profitability.
  • 3Net income attributable to Charter shareholders more than doubled to $807 million.
  • 4Diluted EPS grew significantly from $1.86 to $4.11.
  • 5Free Cash Flow increased by 33% to $1.86 billion.
  • 6Mobile lines nearly doubled, reaching 2.68 million.
  • 7The company repurchased approximately $3.5 billion of its Class A common stock and Charter Holdings common units in the quarter.

Frequently Asked Questions

Revenue growth was primarily driven by an increase in residential Internet customers, which added $679 million due to a higher number of customers and price/product mix adjustments, and a substantial 90.7% increase in mobile revenues to $492 million, fueled by a near doubling of mobile lines.

Charter maintains a substantial debt level, with principal outstanding at $84.3 billion. However, the company is actively managing its debt through refinancing activities, as evidenced by new debt issuances in March and April 2021, and a continued focus on maintaining leverage ratios within its target range of 4.0x to 4.5x Net Debt to Adjusted EBITDA.

The mobile segment continues to be a significant growth area, nearly doubling its lines and increasing revenue by 90.7%. However, it is also a growth investment, with mobile services reducing Adjusted EBITDA by approximately $80 million and free cash flow by $184 million in the quarter due to associated growth costs, sales and marketing expenses, and capital expenditures for network build-out.

Charter prioritizes returning capital to shareholders through share repurchases, having spent approximately $3.5 billion in the first quarter of 2021. The company also invests significantly in capital expenditures to support network growth and infrastructure, with $1.82 billion spent in Q1 2021, primarily on scalable infrastructure and line extensions.